Shares of Groww-parent Billionbrains Garage Ventures Ltd. came under pressure on Tuesday, sliding over 7% after a large block deal involving more than 5% of the company's equity was executed on the exchanges. Exchange data showed that around 30.9 crore shares — equivalent to roughly 5.01% stake—changed hands at an average price of Rs 182.3 apiece. The deal value was estimated at about Rs 5,600 crore. The transaction was struck at a discount to Friday's closing price of Rs 193.52.
Groww shares tumbled as much as 7% to trade at Rs 180 apiece.
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The massive block deal has an indicative offer price Rs 193.5, a 8.5% discount to CMP. Sources added that Kotak Securities and JP Morgan are the bankers to deal. Media reports indicate that several early backers were likely sellers in the transaction. Investors such as Peak XV, Sequoia Capital, YC Holdings and Ribbit Capital were expected to pare holdings through the block route.
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Pre-IPO Share Release
The 18-month lock-in period for Groww's pre-IPO shares comes to an end on May 12. The Securities and Exchange Board of India mandates a minimum of 20% of post-issue promoter capital lock-in for 18 months, starting from the date of allotment or trading approval.
In Groww's case around 400 crore shares, accounting for nearly 65% of pre-IPO shareholder holdings will be released. Of this, approximately 7% is held by promoters and the promoter group. While for promoters capital is locked for 18 months, SEBI mandates a six-month lock-in period for non-promoter pre-IPO shareholders after a company's stock market listing.
The slated release of 400 crore shares that are valued at roughly Rs 80,000 crore, have heightened volatility in the stock.
Groww, which has become one of India's leading retail broking and investment platforms, has seen rapid scale-up over the past few years. The company competes with established players such as Zerodha, Angel One and Upstox, benefiting from strong growth in retail participation across equities and mutual fund investments.
ALSO READ: Groww's Rs 4,750-Crore Block Deal Hits On May 12; Sequoia, Ribbit Capital Among Sellers
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